Hollywood Profits v. Technological Progress

Over at The Chronicle of Higher Education, Fordham University history professor Doron Ben-Atar makes short work of the entertainment industry's and the US Solicitor General's arguments in MGM v. Grokster:

On the face of it, the case for harmony of interests between the studios and the nation is clear. P2P technology allows individuals and organizations to reproduce unlicensed copies for personal viewing and even commercial sale here and abroad. Every pirated version downloaded by an American college student or sold for a couple of dollars at New Delhi's Palika Bazaar, according to this logic, is a net loss of the retail price for the studios and also adds to America's growing trade imbalance.

But that point of view is disingenuous and shortsighted. There is no denying that commercial use of copyrighted material is both illegal and immoral. Yet estimates of the cost of piracy are misleading. They don't account for the fact that piracy fuels demand for entertainment products: 2004 was a banner year for pirates; it was even better for the movie industry, where rentals and sales of DVD and VHS movies accounted for nearly $26-billion. When Hollywood cries poverty, as the victim of pilfering teenagers and workers who live on a couple of dollars a day, it is laughable. And the studios' suit could severely curtail P2P programs' development in America as a resource combining multiple databases, allowing real-time cooperation on a vast scale in science, business, and education.

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